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HomeMy WebLinkAboutNo. 2003 amending resolution No. 1830 amending resolution No. 1823 resolution of the COSBRC pledging TIF revenues for payment, if necessary, of principal of/interest on a loan from environmental remediation revolving loan fund administered by the IN DFARESOLUTION NO. 2003 A RESOLUTION OF THE REDEVELOPMENT COMMISSION OF THE CITY OF SOUTH BEND, INDIANA, AMENDING RESOLUTION NO. 1830 ENTITLED "A RESOLUTION OF THE REDEVELOPMENT COMMISSION OF THE CITY OF SOUTH BEND, INDIANA, AMENDING RESOLUTION NO. 1823 ENTITLED 'RESOLUTION OF THE REDEVELOPMENT COMMISSION OF THE CITY OF SOUTH BEND, INDIANA, PLEDGING TAX INCREMENT FINANCE REVENUES FOR THE PAYMENT, IF NECESSARY, OF THE PRINCIPAL OF AND INTEREST ON A LOAN FROM THE ENVIRONMENTAL REMEDIATION REVOLVING LOAN FUND ADMINISTERED BY THE INDIANA DEVELOPMENT FINANCE AUTHORITY "' WHEREAS, the South Bend Redevelopment Commission (the "Commission ") has adopted various resolutions declaring a certain area located within the South Bend Redevelopment District (the "Redevelopment District ") and known as the "Airport Economic Development Area" as an economic development area and designated such area as an allocation area (the "Allocation Area ") within the meaning of Indiana Code 36 -7 -14, as amended (the "Act "), for purposes of tax increment finance which Area now includes certain property (the "Property ") occupied by Robert Bosch Corporation ( "Bosch ") and owned by the City of South Bend, Indiana (the "City ") pursuant to an Agreement for the Use and Rehabilitation of Real Property between Bosch and the City dated as of August 17, 2000 (the "Agreement "); and WHEREAS, the State of Indiana ( "State ") has established the Environmental Remediation Revolving Loan Program (the "Program ") pursuant to Indiana Code 13 -19 -5, as amended (the "Program Act "), for the purpose of providing funding from the Environmental Remediation Loan Fund (the "Fund ") administered by the Indiana Development Finance Authority ( "IDFA ") for the assessment and remediation of "brownfield sites" located throughout the State; and WHEREAS, the pursuant to Section 9 of the Agreement, (i) the City had previously represented that it is eligible to borrow up to $1,300,000 from IDFA (the "Loan ") through the Program and that it will use its best efforts to borrow such amount and, in turn, loan it to Bosch for purposes of remediating environmental conditions at, on, under or emanating from the Property, including, but not limited to, demolition, asbestos and lead paint removal, and environmental testing and assessment of the Property (the "Program Improvements ") and (ii) Bosch had agreed to repay such loan in accordance with the repayment schedule set forth in the Agreement subject to certain forgiveness provisions set forth in the Agreement as permitted by the Program Act; and WHEREAS, the Common Council of the City (the "Common Council ") adopted Ordinance No. 9192 -01 on January 22, 2001, authorizing the issuance of revenue bonds of the City (the "Bonds ") in the form of the Loan; and SBIMANI 158605v1 WHEREAS, in addition to the promise of Bosch to repay the Loan, IDFA required further assurance of the City to repay the Loan from funds available to the City in the unlikely event that Bosch does not make repayments as provided in the Agreement; and WHEREAS, the Improvements constitute "local public improvements" as such term is defined in the Act; and WHEREAS, the Commission has previously adopted Resolution No. 1823 at its meeting on January 5, 2000 (the 'Pledge Resolution "), whereby the Commission pledged Available Tax Increment Revenues (as defined therein) to the repayment of the Loan as evidenced by the Bonds (the 'Pledge "); and WHEREAS, in connection with the Pledge, IDFA has indicated it will require a parity test with respect to any possible future issuance of Redevelopment District revenue bonds payable in whole or in part from tax increment revenues (the "Tax Increment ") generated in the Allocation Area; WHEREAS, the Commission has previously adopted Resolution No. 1830 at its meeting on January 19, 2001 (the "Amending Resolution "), whereby the Commission amended the Pledge Resolution creating a parity test with respect to the Tax Increment and its use for the payment of principal of and interest on any possible future revenue bonds; and (60� WHEREAS, IDFA has agreed to reduce the amount of coverage required to satisfy said parity test from 150% to 125% and as a result the Commission desires to amend the Amending Resolution to reflect such lower coverage requirement; NOW, THEREFORE, BE IT RESOLVED by the Redevelopment Commission of the City of South Bend, Indiana, as follows: 1. The Commission hereby amends Section 2 of the Amending Resolution to read as follows: 2. (a) The Redevelopment District reserves the right to authorize and issue additional bonds ('Parity Bonds "), payable out of the Tax Increment, ranking on a parity with the Pledge and payable ratably from the Tax Increment for the purpose of raising money for future property acquisition, redevelopment and economic development in or serving the Allocation Area. The authorization and issuance of Parity Bonds shall be subject to the following conditions precedent: (i) All interest and principal payments with respect to all obligations payable from the Tax Increment shall be current to date with no payment in arrears. (ii) The Commission shall have received a certificate prepared by an independent certified public accountant or an independent financial consultant ( "Certifier ") certifying that SBM4AN1 158605v1 - 2 - the Tax Increment estimated to be received in each succeeding year, adjusted as provided below, is estimated to be equal to at least 125% of the principal and interest requirements of all obligations of the Commission payable from Tax Increment for each respective year during the term of the Pledge and the Parity Bonds. In estimating the Tax Increment to be received in any future year, the Certifier shall base his calculation on assessed valuation actually assessed or to be assessed as of the assessment date immediately preceding the issuance of the Parity Bonds; provided, however, the Certifier shall adjust such assessed values for the current and future reductions of real property tax abatements granted to property owners in the Allocation Area. No increase in the Tax Increment to be received in any future year shall be assumed which results from projected inflation in property values. (iii) The principal of said Parity Bonds shall be payable semiannually on February 1 and August 1 and interest on said Parity Bonds shall be payable semiannually on February 1 and August 1 in years in which principal and interest are payable. The Commission shall approve and confirm the findings and estimates set forth in the above - described certificate in any supplemental resolution authorizing the issuance of the Parity Bonds. (b) Except as otherwise provided in this Paragraph, so long as any of the Pledge remains effective, no additional bonds or other obligations pledging any portion of the Tax Increment shall be authorized, executed or issued by the City acting for and on behalf of the Redevelopment District except such as shall be made subordinate and junior in all respects to the Pledge and the Parity Bonds, unless the Pledge has been terminated by the Commission with the concurrence of IDFA and all of the Parity Bonds are redeemed and retired coincidentally with the delivery of such additional bonds or other obligations. 2. All remaining provisions set forth in the Amending Resolution shall remain in full force and effect. 3. This Resolution shall be in full force and effect after its adoption by the Commission. SBIMANI 158605v1 - 3 - Adopted at a meeting of the South Bend Redevelopment Commission held on September 5, 2003, at Room 1308, County -City Building, 227 West Jefferson Boulevard, South Bend, Indiana, 46601. ATTEST: Vice President L_- SBIMANI 158605v1 _ 4 _ SOUTH BEND REDEVELOPMENT COMMISSION President